Changes

2.  Explain what "derived demand" is, and provide an example.

2.  Explain what "derived demand" is, and provide an example.

3.  What is your favorite question on one of the quizzes that ''you answered incorrectly'', and why is it your favorite?

3.  What is your favorite question on one of the quizzes that ''you answered incorrectly'', and why is it your favorite?

:::<math>\frac{-Q}{P}X\frac{P}{Q}</math>

:::<math>\frac{-Q}{P}X\frac{P}{Q}</math>

and thus P_ed= -1.  By convention, because price elasticity of demand for one good is always negative, the negative sign is dropped and we have our answer:  price elasticity is 1.  (Price cross-elasticity of demand may be positive or negative, depending on whether the two goods are substitutes or complements.)

:::and thus P_ed= -1.  By convention, because price elasticity of demand for one good is always negative, the negative sign is dropped and we have our answer:  price elasticity is 1.  (Price cross-elasticity of demand may be positive or negative, depending on whether the two goods are substitutes or complements.)

[[Category:Economics lectures]]

[[Category:Economics lectures]]